Work, Interrupted: Building slowdown cuts deep, wiping out 17,000 jobs
Wednesday, 16 July 2025
New Zealand’s construction industry is emerging from one of its toughest periods, with more than 17,000 jobs lost over the past 18 months.
Many qualified workers remain sidelined and recruiters say the work has dried up for tradespeople who, until recently, were in high demand.
The downturn has affected everyone from apprentices to experienced professionals, but there are cautious signs that a recovery could be on the horizon.
Tyler Robinson, 27, of South Auckland, is among those caught in the downturn, despite doing everything right.
After completing a pre-trade certificate in building in June, he’s been searching for an apprenticeship.
“It’s very, very difficult to try to get an apprenticeship,” he said. “I’ve got all the prerequisites, full licence, Site Safe [certification] and everything. But yeah, like, it’s hard.
“Apparently I didn’t meet all the requirements … there’s been other people who’ve had better skill sets than I have.”
The fall follows the post-Covid building boom, during which record-low interest rates, high migration, and government stimulus drove new housing and infrastructure demand to record highs.
“We’re now in the adjustment phase … and less work means less jobs,” Infometrics chief executive Brad Olsen said.
“The construction sector is trying to find its new normal. What's the Goldilocks zone in terms of construction activity for the sector? And therefore, how many people do they need?”
He warned the downturn may have long-term effects on capacity.
“If you've lost a bunch of talent in the construction sector … then this sort of cyclical change does make it harder to get ready for the potential next upswing.”
Private investment has slowed, government funding has pulled back, and population growth has moderated, all combining to stall demand.
Olsen said regions like Otago, Bay of Plenty and Canterbury are holding up better than others, but the national outlook remains “patchy and subdued”.
Josh Galuszka, a senior consultant at Key Skills Recruitment with more than 20 years in the trade, said the past six months had been the hardest of his career.
“This is really horrible. The last six months are the worst six months we’ve seen … so many people leaving the industry.
“Two years ago, I could take 10 or 20 good builders and have them all placed with one round of phone calls,” he said. “Now, even experienced, licensed guys are struggling. They’re turning to labour hire agencies or sitting idle. That was unheard of.”
Galuszka said many employers are offering shorter contracts and lower rates. Projects that once ran for 12 to 18 months now span only weeks.
“Clients are cautious. They want flexibility. That’s made life harder for workers, and it makes my job as a recruiter much more difficult too.”
In Christchurch, the situation is slightly more stable, thanks to projects like Te Kaha stadium and ongoing townhouse developments.
But Cody McMullan, partnerships director at Heights Recruitment, said the overall picture is still one of caution.
“We’ve seen a tighter market over the past two quarters, especially for project managers and apprentices.”
What makes this downturn different, Galuszka said, is the absence of large-scale public investment to cushion the blow, something that has traditionally supported the sector during economic slowdowns.
“Governments tend to get involved. Infrastructure and education and health all has construction elements to it,” he said. “But what's happened is this government hasn't done that. They've just pulled the pin on everything. Kāinga Ora is gone.”
He compared it to the deep cuts of the early 1990s: “People that I know … in their mid 60s … they're like, ‘This is as bad, if not worse, than that.’”
Galuszka said one of his biggest concerns is the number of experienced New Zealand builders leaving the industry altogether, including apprentices dropped in their second or third year despite government funding to support them.
He also said younger workers who never finished their apprenticeships had been among the first to fall out of the workforce.
“This was the first wave of people to get made unemployed 18 months, two years ago — second and third year apprentices,” he said.
McMullan agreed entry-level placements are tougher now.
“That is a very tough space to enter at the moment … clients are essentially wanting plug and play options.”
Robinson, who completed a level 3 building qualification at MIT, said one of the biggest challenges he’d faced was balancing job-seeking with caring for his children, aged 3 and 5.
He recalled being turned down for a national apprenticeship programme after disclosing he had no formal childcare in place.
“I actually felt … very discriminated against, if that makes sense,” he said. “Why should they say that when I’m actually trying to look for a job to better things for my kids?”
Robinson isn’t giving up on becoming a builder, but he’s exploring other options
“I’m still trying to look for jobs in the building industry, but also going down the route of a different industry, like trucking or something like that. Yeah, so I’ve got a backup plan if it does fall through with the building industry.”
Despite the bleak winter, recruiters and economists are beginning to see signs of recovery.
Architects and estimators are reportedly busy again, and developers are once more seeking pricing for future projects.
McMullan said the market had begun to shift.
“Probably the last four to six weeks for us, we've actually probably seen it going the other way, which is fantastic.
“We've had a lot of our sort of good construction customers reaching out and going, ‘Hey, look, we're ready to go.’”
Galuszka said he believes the sector is now at the bottom of the downturn.
“How long we stay here, I don't know,” he said. “But I also am optimistic, probably about the next six months.”
Olsen agrees, but tempers expectations.
“We’re unlikely to return to the Everest-like peaks of recent years without another major economic event,” he said. “But we may be starting to climb out of the valley.”